House Hunting! What should we know?

Aug 28, 2012 4:32 PM

Hubby & I currently own the condo we live in, but it's really time to move into a house. We will be keeping the condo to rent it out, so we won't have the headache of trying to time a purchase with the sale, thankfully. It's currently just us and 3 cats, but we'll definitely be adding 1-2 dogs. No kids (now or in the future), but we are preparing for the possibility of my and/or his parents having to live with us someday. Based on what's available in the area we're looking, we're probably going to end up with 5 bedrooms & 2.1 baths, between 2200-2500 square feet. It is MUCH larger than we need, but the parents thing makes it much more okay that this size seems to be what's on the market here.

What should we know when looking at houses? Are there things you regret getting in a home? Things you got as a perk and now couldn't live without? What's your horror or wonderful house hunting/finding story that we can learn from? What thing should we know before we get too far in the process?

Keep in mind the larger the house the higher the utility bills so look for something energy efficient. Older homes have less insulation, less efficient heating/cooling equipment, etc. but some of the homes that were thrown up during the housing bubble could have substandard construction.

New homes (at least in my area) tend to come with association fees and that could be another big expense.

Have you thought about building a home? We got to pick our lot - wooded and at the end of the road, no neighbors behind us or beside us on one side. Then you can pick out everything and make changes, if necessary, to the plan you choose. We didn't want to move into a house and inherit someone else's troubles. If I remember correctly, our house came with a 10 year warranty too.

By the way, we looked at several houses before we decided to build. It was hectic at times but worth it in the end.

@narfcake: Assuming everything works out the way we've planned, we've already got it down to a specific neighborhood. Neither of us are very handy, nor will we have another $50k to throw at remodeling, but we're not afraid to try at least some of the smaller projects ourselves.

@ohcheri: Yeah, we're definitely keeping an eye on the utility expense issue. i think that's going to be the thing that hits us pretty hard, but we've started trying to get average informaiton for the homes we're looking at. We're only looking at one home that has an association fee, but it's very reasonably. If memory serves, it's $55 every quarter. Heck, our condo association fee is $116/month because we're such a small group.

@carl669: Yeah, we're definitely trying to find the right one. I've actually fallen in love with a house, but the taxes, association fees, etc are overwhelming for it, so we're holding off on that one, at least for now.

@missellienc: Ideally, we would build, but I don't think building is a financial option for us. If the market weren't where it is, we wouldn't be able to buy anything close to the homes we're looking at now. We're hoping to spend about $130k plus closing costs at the most, which we're probably going to pull off even with the size of homes we're looking at.

@missellienc: Excellent suggestion. And I would add that you should go with him for the inspections, so you can ask questions or even have him check anything you want checked out in further detail. It may cost you a bit more, but it is much easier to ask questions while you are looking at the house, then to go over a report later on.

If you are possibly going to have elderly living with you, you are going to want the features:

- single level or complete living quarters on the ground floor.
- as few steps as possible and as low as you can get (wife's grandmother broke her leg stepping into the house) inside and out
- accessibility in case of wheelchairs and walkers
- bathing facilities with low entrances and room for a chair, if necessary

Even if your folks are mobile now, there may be a time in the future where they are not.

As always when purchasing a house - get a trusted housing inspector and take the time to go through the house with him.

Don't be afraid to ask questions of the inspector, current owner, and realtor.

All sales records are public record at the county assessors office, if you are lucky they are on-line.

@missellienc: +1 on the home inspection - it's a few hundred well spent.

In my case, the report noted items beyond the obvious like the rusted out sinks, the mold in the bathroom sink cabinets, and the water leak stain in the ceiling. It revealed that the furnace wasn't at 100%, the AC didn't work, the microwave didn't work, the uneven roof and the underground main in the front yard was leaking.

I had my agent write those aspects into an addendum, though not in the usual way. "Buyer acknowledges home inspection report, inclusive of non-functional HVAC system, roof, and water main leak." That solidified my offer over the dozen other ones that were submitted, as the new listings at that time were going for 30k higher already than my 11%-over-listing-price offer.

FWIW, the furnace required a new ignition module, the AC a new contractor (relay), the bathrooms renovated, the microwave was recycled, and we ended up redoing the whole underground run ourselves, from the meter to the house.

For elderly parents, you may want to also think about kitchen access for wheelchairs or the possibility of installing a mini kitchen that is accessible. Those nice islands that are so popular these days often leave passages that are too narrow.

And then think of the silly things and make a list, like I don't want a master bedroom that faces the street to must have a shower in the hall bath. Left brained folks that my husband and I are, we had a sheet for each house we saw with specs like sq ft, land, gas/elec stoves, and then requirements, 4bdrooms, etc. We filled out a sheet for each house and when it came time to compare, it made it easier to remember. And easier to prioritize which house may be a better fit, especially since you sound like you're willing to do extra work on it.

@smtatertot13: About not being too handy ... learn. Books, Google, YouTube - there are many resources readily available nowadays for one to tackle a task. At the very least, know what's involved so at least one can make a decision whether it's something that can be DIY, or best left to the pros.

FWIW, that underground main I replaced was under $500 in materials in tools vs. $3300 for the cheapest plumbing outfit. Trenching and backfilling 3-5' of soil for a 50' run was not fun, but opportunity costs says I don't make $2800+ in the 3 days (on-and-off) it took either.

Do not buy a house with a drive way that the house is on the south side of the road, if you live in an area that gets snow.
I scoop and scoop and scrape my driveway clean, my neighbors on the north side of the road run the snow blower and the sun takes care of the rest. Perfectly clean driveway in a day or 2. (((SO JEALOUS)))

@smtatertot13: I can't stress overlooking cosmetic issues enough. People will walk into a house and say "Oh, this is awful!" and the only thing wrong with it is the paint color and fixtures.

My wife and I got our house at a steal because it had hideous paint colors, terrible wallpaper borders, and mostly broken (or missing) light fixtures. It seemed like people just didn't want to fool with fixing it. I'm not going to lie -- my wife and I have spent nearly a year fixing the little things in the house but now we have a really nice, huge house in a really nice neighborhood with mature trees and great views. It was worth the haul.

If you can turn a screw driver and hold a paint brush, the possibilities are endless.

Also, be sure you get preapproved for a loan. It will give you a better idea of not only what you can get, but what you can afford as well.

Others before me have given you great advice! My approach is a bit different...

Make sure that you can afford 2 mortgages at any time. And for an unknown length of time. Your condo might be w/o tenants for months. Note: You said you "own" the condo; is there a mortgage on it?

Can you afford the insurance (the condo will go up since you are renting it), taxes and normal repairs on BOTH places? Do you want to be landlords? You will be on-call 24/7. Can you afford to redo - paint, new floor coverings, etc. before new tenants move in?

Are you relatively secure in your job(s)?

Have your parents/in-laws said they would like to live w/you? Are they near the age where that could happen? Purchasing a larger home w/that as a possibility in 10 or more years may not be prudent.

All that said, I commend you for being thoughtful & diligent. My questions are all rhetorical - just posed to bring up areas that I thought of. No need to respond.

orientation to the sun of the house and neighbors houses and trees will affect how things grow in your yard. if you are considering a garden or other landscape type things.
also if you have snow, a southern facing driveway definitely helps in snow removal for melt and build up of possible ice.

1. Home renovation/fix-up projects will ALWAYS take longer and cost more than expected. No exceptions.

2. Don't buy more than you need. Only looking for a 2-bedroom but there's a 3-bedroom up the road for just a little more? Don't do it. Get what you want/need, save the money and use it later. If you have to, set up a separate bank account and deposit the part of the difference between the payment you make and the one you would have made and put it towards that bigger/nicer one later.

3. Location. I know it's been mentioned, but here's another thing to think about: schools. You may not be looking forward to having kids in this house but it can happen, and even if it doesn't, who is to say that the people you eventually want to sell the house to do have kids? TL;DR: even if you don't have kids, being in a bad school district greatly hurts resale values.

4. Single level or not? Two levels make it harder for older folks (parents going to visit?), disabled folks, etc.

A lot of what others have said is great advice. Home inspection is a must. Accessibility is huge if you're thinking of having elderly parents living with you.

Also, if you're in a particularly hot or cold climate and the house is large enough to have multiple HVAC units, make sure they are sized properly. Three of my coworkers have had issues in the past two years with improperly sized AC units for their upstairs. It has cost them large amounts of money to get that fixed/replaced. The home inspector might be able to help with this or you might need to hire an HVAC guy to come out and assess the units.

Make sure the inspector will do a termite inspection (sometimes you have to pay extra). Termites are expensive to deal with.

Think about home maintenance. Do you want to take care of a pool? A big yard? A yard on a corner (lots more to edge and generally more to mow)?

Be sure to do some investigation into your possible neighbors. Are they couples with kids, older folks, renters, college kids, people with 4-5 cars in various states of repair, 20 dogs, etc. Try to visit at different times of the day to see if it's loud in the evenings or weekends, if the road is a popular morning/evening rush hour shortcut, etc. Remember, you can always change things about your house, but you can't change your neighbors. Well, at least not legally in most cases.

might wanna meet your neighbors. i moved into an ideal tin roof country house with a couple acres and what i though was plenty of privacy. since i've moved in my jackass neighbor tore down all his trees, which means i now have a direct view into the back of his house and now he's adding onto his house, and all i see is this annoying monstrosity out of my back window all the time. to make matters worse, after we moved in, he got a dog, that he ignores but keeps staked in his back yard, and i barks constantly. after several confrontations and calling animal control, now all i can think of is fixing my house up and moving out. just make sure your neighbors dont suck.

Several have mentioned 'neighbors', yes it may be helpful to talk to neighbors. You can get a feel for the what it might be like to live there. Unfortunately, your neighbors can change. Immediately. And often. Mine have. Even the demographics can change radically. From older, retired people - to young w/children. You have absolutely no control over this.

As mentioned many times, the location of the property is very important. Also, it's been said that you should never buy the most expensive house on the block. Best to buy a mid or lower priced home.

As you know the real estate market is very volatile now. A big concern might be an abundance of foreclosed properties in the area. It may be an indicator of homeowners who bought property they could not afford. Or, sadly, they may have suddenly become unemployed. On the converse, this may be a good time to buy w/the glut of foreclosures. You may pick up your dream home at less than the true value.

everyone has given such great advice! admittedly, i'm a little overwhelmed with all of this, but I plan to pull out all the great advice and share it with my husband so we can make a list of all the important things to remember. Thanks EVERYONE for sharing your input. I really appreciate every bit of it!

Our Realtor paid for the first year of a home warranty for us as a house warming gift. We've renewed it every year since. Ours is from 2-10.com. We have used it several times. Sure, it costs 12 bucks a week approximately. Yes, we have "wasted" it a year or two. But, when the air conditioner goes out and you have extreme heat in the forecast, it sure is comforting knowing that I just have to write a check for $50 (trade fee) and everything else will be covered. It is totally worth the peace of mind.

Here is my list of things I didn't realize when I bought my house and will be paying close attention to when we build/buy our next house.

Direction the sun goes and will shine in on different windows of the house
If you have a large vehicle, will it actually fit in the garage (length)
Is closet space adequate
Take a look at how neighbors care for their yard/homes
Drive through the neighborhood late on a friday or saturday night - what do you see/hear

Trust no one, particularly your realtor and the home inspector. Get someone you trust- REALLY trust- to look at your potential new home's innards with an unattached eye. Someone who won't profit from you moving in OR walking away.

Get approved for your loan before you need it. Have it ready to go when you want to place a bid.

Get a home inspection before you close. Find a good reliable inspector. They will be able to show you any problems with the property. You can use that information as negotiating leverage to bring the price down, or if there is a deal killing problem, you can walk away.

Look at the layout of the house and the quality of the physical construction. Cosmetic stuff like carpetting, paint, trim, fixtures, etc. can all be upgraded fairly easily. Poor construction / layout costs big money to fix.

Get the sewer line scoped. Replacing a broken sewer line can cost tens of thousands. Better to know what you are dealing with ahead of time.

In your contract, try to split the closing costs, then buy down your mortgage rate a couple points. The seller picks up half of that cost. Can save you thousands in the long run.

@havocsback: Good call. I'll add that you can ALWAYS go back to look at a home twice. Sure, going back may give the sellers a hint that you're really interested and they MIGHT bargain harder, but at the same time, if you are really interested then getting a second look either at a time when you don't have other houses to look at that day or/and when you have a friend who isn't attached already can be a great way to gauge things.

A few other things: don't feel bad about looking at homes even if they're not possibilities. Feel free to hit up some open houses or something on an afternoon. This can help you develop ideas of just what you like/don't like for YOUR house.

Keep notes! Your own notes! Don't trust anybody, even your Realtor/agent, to write down or remember what YOU really think.

Do not use Zillow. I know it's tempting to source listings you want to look at from their web site because it's so easy, but just don't The site is absolutely terrible at keeping up with what listings are active and which aren't, and frequently details in the listings on their site are incorrect. If you want, you can use the site to check pictures (their interface is frequently better than the listing agent's for picture galleries) or to do a quick check on neighboring property sale prices (their estimated current value numbers are also frequently flawed, so just use the hard data).

I'm a RE/MAX Realtor, and help folks with exactly your concerns all the time. I'll re-iterate a lot of what the others have said, and add a few of my own. We have a package for our potential buyers with all kinds of information on the process, but I'll be happy to give you a VERY truncated introduction...

FIRST STEPS - Talk to several lenders, and get pre-approved for a mortgage. They will pull your credit, and let you know what sorts of loan programs are available for you, and what your realistic budget is. I prefer to work with mortgage brokers instead of direct lenders, as they will shop your loan around to find you the best deal. (And don't get too hung up on interest rates, everyone will be able to offer about the same - it's the fees you need to watch!) If you have a good relationship with your local bank or credit union, you should talk to them. If you speak to one lender or a dozen, as long as they all pull your
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credit within a window of about a month, it only counts as ONE inquiry, and won't be a problem. Avoid lenders that aren't local - if you have an issue, you want to be able to go in and see them IN PERSON. (They'll also have a higher stake in maintaining a good reputation than an internet based lender.)

Since you're going to be keeping the condo you live in, that makes matters a little more complicated, since they'll probably not count the rental income of your condo towards your income. So you'll need to be able to carry BOTH mortgages with your current income. If you have more than a couple of years experience as a landlord, they may allow up to 75% of the anticipated rental income to count, but that doesn't sound like your situation.

Find a Realtor that will represent YOU as a buyer. If you call the agent who has a sign in the yard of the property you want to buy, their job (legally and morally) is to get top dollar at the lowest risk for the seller. In many places, you...
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...can get buyer's representation, where a good buyer's agent will represent YOU, look out for YOUR interests, and negotiate on YOUR behalf. You want to hire someone who works full time as a Realtor (not someone who does it on the side, working occasional nights and weekends.) A 'nice' Realtor is great, but you want someone who is going to be tough and competent when it comes to advising you. If you need assistance, I can probably help you find someone local to you - I'm part of several national networks - send me an email to gregmaiser (at) remax (dot) net

Searching: Trulia, Zillow and Realtor.com are all out of date, and sadly - not very good resources; but as a consumer, that's what you've got to work with. A good realtor should be able to give you access to search tools that work better, as well as having personal, professional knowledge of neighborhoods that you'll not get from those aggregators.
They'll also know how to ferret...
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...out things that don't quite match your search criteria, but are indeed a good match for your needs.

When you finally find the house you 'love,' that's great! As has been mentioned, make sure that you ALSO can live with the things that you cannot fix - in addition to neighbors you should consider traffic, zoning, crime, taxes, etc... You say you're not that worries about things like schools, but bear in mind that a good school in the area will help with your resale value down the road. (Of course, the flip-side is that means you'll also pay more for it now, and may also have a higher tax rate in the meantime...)

Do a home inspection, preferably with an inspector your Realtor knows and recommends. A home inspection isn't required, but it's a really good idea. Be there for the inspection, and follow them around and listen to everything they have to say. You should get a lot of information that won't be in a report, such as suggested maintenance schedules for...
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...your furnace, how to keep the basement dry, hints to adjust your garage opener, etc, etc. The inspector doesn't pass or fail a home - they identify issues that are of current concern, point out potential hazards, and give you an idea what might need to be repaired later. Talk to your Realtor about your options, should the inspection reveal things that significantly affect the value or utility of the home. A good Realtor isn't afraid to advise you that getting your deposit back and finding a different house might be your best bet.

The process can be fun, and it can be stressful. Having a good team of professionals on your side is crucial to your success. (Realtor, lender, inspectors, contractors, attorneys, etc…)

Think lower than the home. Get a site survey. Make sure the elevation of the home is 10' over the base flood elevation (BFE). You will be ensured a home that does not flood and also your insurance premiums will not rise when the government changes or updates the flood maps.

Ask to see the buyers survey and make sure the two elevations match. In my experience surveyors are turkeys and when they screw up are impossible to sue. Good luck proving damages on your next sale.

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